Ask any economics student what determines price and the instant answer will be ‘supply and demand’. This is as true for housing as is for anything else from crude oil to bitcoin.

Critically for the house seller, some of these factors are beyond your control whilst others can be made to work in your favour.

One of the reasons prices are so high is that a very small percentage of the housing stock is available at any one time. Last year less than 4.24% of Oxfordshire’s housing stock was sold. In other words, any one Oxfordshire home comes to the market on average every 23½ years! Read more

In my last blog I wrote about how the volume of residential property sold had dipped an astonishing 29% in 2017 (Oxfordshire Property Sales Plummet) so it seemed a good time to conduct a deep dive into the rental market in West Oxfordshire, with a particular focus on Witney as the main urban centre.

Supply of Rental Property Increases

We track the supply of rental properties in Witney over time so we can provide contemporary, unique advice. What’s been particularly noteworthy is that the supply of property to rent in OX28 is up by 55% on 2017 and this isn’t specific to any given size property:

The latest NAEA report suggests that some first-time buyers, particularly in areas outside of London are pushing themselves further in order to maximise the benefit of stamp duty relief. In this way, they suggest, they are skipping the traditional first home and making the jump straight up the ladder to what might previously have been their second purchase, thus also saving on future stamp duty costs.

While shrewd of first-time buyers, if this becomes more widespread, pressure is likely to intensify on next rung of the ladder making it harder for those true ‘second-steppers’ who wish to move up the ladder out of their first home.

In 2016-17, the private rented sector accounted for 4.7 million or 20% of households.

The latest English Housing Survey (2016–17) has just been published and it reveals the continued growth of the private rented sector. Over a fifth of households (20.3%) now rent privately, up from 19.9% a year earlier and a higher proportion than ever before.

As is well documented, across all the regions, the growth in London’s rental sector has been most pronounced. It now accounts for 30% of households, up 11.6 percentage points from ten years ago. While there are over 2 million more households renting privately than there were ten years ago, almost half a million of these are in London.

In 2006-07, about three quarters (72%) of those aged 35-44 were owner occupiers. By 2016-17, this had fallen to half (52%). While owner occupation remains the most prevalent tenure for this age group, there has been a considerable increase in the proportion of 35-44 year olds in the private rented sector (11% to 29%). The proportion in the social rented sector did not change.

The most recent available figures for West Oxfordshire show that 12.5% of households live in social rented accommodation and 14.9% (6,243 households) in privately rented accommodation. Delving into the detail a bit more; there are 1,525 privately renting households in Witney (13.4%) and 1,660 in Carterton (28.2%).

Historically, experience tells us that the premium paid for new build properties increases in a strong market but narrows again in a slower market as developers reduce prices in order to achieve sales.

While not directly comparing like for like, it does raise some interesting questions. Few would say that 2017 was a particularly strong year for the market and yet the new build premium continues to rise.

From 1st April, all new rental leases and renewals of tenancies will be required to have an energy performance rating of at least E on an Energy Performance Certificate (EPC). For existing tenancies, the regulations come into force on 1st April 2020.

The majority of landlords are well prepared, but we calculate that around 7% of properties let in 2017 still need to be brought up to the standard required. Best prepared are London landlords where just 4.9% of properties let last year were lower than an E rating, while in the South West more than 10% of properties did not meet the standard.

We wondered how much tenants are prepared to pay for energy efficiency. Properties across England and Wales let in 2017 with an energy performance rating of E achieved 3.1% more per square foot than properties let with an F or G rating. On an 800 square foot property, this equates to an average of £360 per year.

At the top of the scale, properties with an A or B rating achieved, on average, 31% more per square foot than F and G rated properties in 2017. On an 800 square foot property, this equates to an average premium of £3,600 per year.

For an in-depth look at the average EPC of properties across West Oxfordshire, have a look at our earlier blog on the subject at West Oxon Energy Efficiency

An estimated third of employees spend at least some of their week working from home with high speed broadband rising up the criteria list for new house buyers. Evidence suggests that broadband speeds could affect the price that buyers end up paying for their next move. Read more

The latest data from the ONS suggests that the volume of property transactions in Oxfordshire have plummeted[1]. Across the County as a whole, 26% fewer properties have been sold than 12 months previously whilst values have risen in line with inflation and crept up +2.7% to an average of £356,262. This compares with an average price of £243,339 (up +5.3%) across England. Read more

As with so many festive traditions, the twelve days of Christmas leading to Twelfth night are familiar, even if their roots seem a little shrouded. Generally recognised as the period been Christmas day and the Coming of the Epiphany the period marked the traditional length of Christmas festivities. Pagan beliefs also explain the tradition of taking down festive decorations on Twelfth Night. These decorations often took the form of evergreen foliage (typically holly and ivy) and some believed that tree spirits sheltered in the decorative sprigs. Removing them either before or after Twelfth Night came to be regarded as unlucky as the disgruntled spirits would exact a toll in the following year’s crops! Read more

Looking at the revised West Oxfordshire Local Plan and the requirement to deliver 660 new homes per annum until 2031, I thought it might be worth considering what these new developments might look like. How do the more recent, strategic developments stack up and what’s changing? Over the years housing densities have changed as new developments seemingly cram an ever-increasing number of properties into the available space. Looking at the biggest differences then you might be surprised to note that the average dwelling size is pretty consistent, it’s just the number of people within the given space which has rocketed. It’s time to get friendly with the (very close) neighbours!

Looking at the bigger picture, the most densely populated District in England (population per km2) is Islington at 15,670 and the least is Eden (Cumbria) at 24! Across Oxfordshire, the picture is more mixed. Oxford City comes in at 3,537, Cherwell is next at 248, followed by VoWH at 222, then South Oxfordshire at 203. West Oxfordshire is the least densely populated and at 152 people per km2 it’s the second least densely populated District in the South-East.

Finding data on the profile of tenants and actual rents paid (not just asking rents) has been like hunting for the Holy Grail in the property world, which is why we are delighted to announce that we have a new, large and reliable source, integrated into our databank and we will be digging deep in the coming months to explore trends and reveal insights.

For instance, we have been surprised by the short distances tenants generally move for a rental property. Over a quarter of tenants in England and Wales starting new tenancies in the last 12 months moved less than a mile from their previous home.

Local government forecasts predict a 29% increase in the population of the Witney area over the next 10 years. Coupled with the exceptionally low rate at which we are building new homes and sales volumes (the number of properties sold) dropped by 19% in 2017 (compared with 2016) and the market fundamentals remain out of balance. Read more

Ten years on from the housing crash and it’s worth taking stock and looking back. Counter-intuitively, in 58% of wards, residential properties are selling for less now, after accounting for inflation, than they were in 2007. Read more

The ONS has just released average house price data per square metre for properties across England. At a regional level, a buyer in London should expect to pay around £6,639 per square metre (£617 per square foot). More locally, we’ve identified the cost in £/ metre and feet – depending on your vintage! Read more

Would you like to know more about investing in local property? Whether you’re a seasoned landlord, just dipping your toe in the water or on a fact finding mission then this event is essential to get all the latest facts, tips and critical information to get the very best advice about investing in property in West Oxfordshire. Our panel of experts from local, Witney businesses are on hand to dispense free advice at 6pm on Thursday 9th November at the historic Witney Blanket Hall. Experts from Everyman Legal (solicitors), M Group (accountants), Martin & Co (local property experts) and London & Country (mortgages) will be on hand after the 1 hour presentation to answer any further queries you may have. We’ll even provide something to eat and drink!

Please register now for your free tickets as spaces are limited: witneypropertynews.com or look on Facebook for Martin & Co Witney for more details

Research by the Resolution Foundation think tank has found that young people are spending three times more on housing than their grandparents did.At the age of 30 millennials spend 23% of their annual income on housing costs, compared to those born 1926–1945 who, aged 30, spent just 7%.

The post war baby boomers now benefit from record levels of outright ownership, but there are now as many young families (aged 25–34) living in the private rented sector as owning a home or living in the social rented sector combined (36%).

While the number of mortgage loans issued to first-time buyers over the past year is at its highest level since pre the financial crisis, the average age of a first time buyer looks set to continue to rise over the coming years.

It’s therefore cold comfort to those of us in the South-East that homes across more than half of the UK are more affordable now than before the financial crisis according to new research by the Yorkshire Building Society who analysed changes in local house prices and earnings since 2007.

The gap between the least and most affordable parts of Britain has doubled over the last decade, with housing affordability having fallen across all of London’s 32 boroughs.

Homes in cities including Birmingham, Newcastle-upon-Tyne, Leeds, Harrogate, Edinburgh, Liverpool, Cardiff and Exeter are now more affordable than they were 10 years ago, while across Cambridge, Oxford, Bristol, Manchester, Nottingham and York property price rises have outstripped wage growth.

With the communities secretary announcing a new methodology for new build development based on household projections and affordability criteria, local authorities with high affordability ratios could be expected to build up to 40% more than their current targets. Perhaps the West Oxfordshire Local Plan will be examined further?

1. Location. Is it in an area of high tenant demand? Cheap does not necessarily provide you with the best return on your investment.2. Target tenants. Consider who your ideal tenants will be BEFORE you purchase, and search accordingly.3. Refurbishment. What work needs done to make the property attractive to your target market and how much will this cost?4. Management. How will you find your ideal tenants and how will you ensure they will look after your property and that you are paid on time.5. Exit strategy. Often overlooked, how long do you intend keeping the property for and what are the tax implications on disposal?

If you are considering your next investment purchase please give us a call. We can discuss your options and help you find, refurbish and manage your property to ensure you achieve the best return on your investment.

We happy to provide expert advice without commitment or ‘hard sell.’
Please call Brendan on 01993 708638 to find out more.

Meet The Author

Brendan Kay

Welcome to Witney Property News where we aim to bring together the latest property market news, information and tips for anyone with an interest in property.

Investors, first time buyers and home movers should all find something in here to help make sense of the West Oxfordshire property market. If you’d like to drop me a line about anything property related then please email me at:

brendan.kay@martinco.com

Or call:

01993 708638

Brendan

Mortgage & Affordability Calculators

Handy calculators to work out what you can afford and to see the very latest best buy deals: